Chile sues U.S. banks over hidden Pinochet accounts

MIAMI — Chile's government has filed lawsuits against four banks claiming those institutions were negligent or had deliberately helped former Chilean dictator Augusto Pinochet conceal about $26 million in public funds allegedly stolen over several decades.

The lawsuits filed Wednesday in federal court in Miami claim the banks were complicit in the alleged theft of the Chilean funds by Pinochet and others reputedly assisting him. The Chilean government seeks an unspecified amount of damages, although that would likely run into the tens of millions of dollars.

Following basic bank regulations and complying with money-laundering rules would probably have exposed many of Pinochet's hidden accounts, according to the lawsuits filed by Miami attorneys Pedro J. Martinez-Fraga and Tania Cruz on behalf of Chile's State Defense Council.

"More tragically, some of these financial institutions went beyond mere negligence, and instead chose to knowingly and actively assist Pinochet in concealing the source and true ownership of the substantial funds being deposited into their institutions," the lawsuits by Chile's government legal office allege.

A PNC spokesman said the bank wouldn't comment. The other three institutions did not immediately respond to e-mail and telephone messages left by The Associated Press seeking a response.

Pinochet's finances have long been the subject of investigations in Chile, the U.S. and elsewhere.

Many of the U.S. connections were exposed by a 2005 U.S. Senate probe that brought to light allegations that Pinochet controlled about 50 secret accounts in 10 U.S. banks through aliases, family members and offshore entities.

One such institution was the venerable Riggs Bank in Washington — acquired in 2005 by PNC — that paid more than $40 million in fines and penalties for its Pinochet relationships.

The Chilean lawsuits allege Pinochet siphoned public money for personal use through a number of ways, including a government presidential security account, accounts opened in the names of Chilean military officers and commissions from various arms deals — such as a late-1990s transaction involving the sale of German Leopard I tanks.

No court dates have been set for any of the lawsuits, which were assigned to four different judges but could be consolidated into a single case.

For years, Pinochet's defense lawyers and family members have said the money was legitimate and the accusations politically motivated. They insist the money came from donations by wealthy supporters worried Pinochet would be persecuted after leaving power.

Pinochet's wife and grown children were indicted on tax fraud charges in Chile amid a probe of the general's wealth.

Those charges were dropped on a technicality in 2007 for those family members save Pinochet's younger son, Marco Antonio, who is still facing charges.